TING JAMES HENRY v. HKSAR

FACC No. 4 of 2007

IN THE COURT OF FINAL APPEAL OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

 FINAL APPEAL NO. 4 of 2007 (CRIMINAL)

(On appeal from CACc No. 318 of 2005)

_____________________

_____________________

__________________

J U D G M E N T

__________________

Chief Justice Li :

1.  I agree with the judgment of Lord Woolf NPJ.

Mr Justice Bokhary PJ :

2.  I agree with the judgment of Lord Woolf NPJ.

Mr Justice Chan PJ :

3.  I agree with the judgment of Lord Woolf NPJ.

Mr Justice Ribeiro PJ :

4.  I agree with the judgment of Lord Woolf NPJ.

Lord Woolf NPJ :

Background to the appeal

5.  On this appeal we have to consider what is the correct approach to ordering a retrial after a conviction has been quashed. 

6.  The appellant “Ting James Henry” had been convicted of two offences at a trial before Beeson J and a jury after a 38 days’ trial on the 29 June 2005.  On the following day, he was sentenced to 6 years’ imprisonment on each count concurrent.

7.  The appellant applied for leave to appeal against that conviction and, on 22 September 2006, the Court of Appeal, Woo VP, Tang JA and Lunn J granted leave to appeal, quashed the convictions and ordered a retrial.  The appellant was also admitted to bail.  The Court of Appeal, on 5 December 2006, refused leave to appeal to this Court against the order for retrial, however, on 16 March 2007, the Appeal Committee of this Court gave the appellant leave to appeal and, certified three points of law for purposes of the appeal.  The three points of law are:

(1) Whether the Court of Appeal erred in principle in the exercise of its discretion in ordering a retrial within the body of a judgment setting aside the conviction which judgment was handed down, without affording the appellant an opportunity to consider the grounds upon which the conviction was set aside and to make fully informed submissions thereon.

(2) Whether, the Court of Appeal having reached the conclusion that the basis and evidence upon which the prosecution had chosen to conduct the case against the appellant had rendered the conviction unsafe and unsatisfactory, they should not have ordered a new trial in order that the prosecution be given an opportunity to supplement a case which has proved defective and make a new case that was not made at trial, and that such decision was in conflict with the basic principle that in every criminal trial it is for the prosecution to prove its case against a defendant.  See King v. R [1986] 67 ALR 379.

(3) Whether the Court of Appeal erred in formulating its own view of the way in which the prosecution ought to have conducted its case and then directed a retrial which would enable the prosecution to profit from the considered opinions and judicially crafted formulation of the Court which would only hopelessly prejudice the appellant in any retrial.

8.  It is common ground between leading counsel for the appellant, Mr Alun Jones QC and for the respondent, Mr I C McWalters SC, Deputy Director of Public Prosecutions that, before the Court of Appeal, Mr Alun Jones QC had not had a proper opportunity to address the Court of Appeal on the issue of whether there should be a retrial, though the issue had been provisionally discussed by him with the Court at the hearing.  In the Case for the Respondent, Mr McWalters, SC points out that after the hearing of the appeal, the prosecution decided to change the manner in which they would advance their case against the appellant at a retrial.  This meant that the appellant did not have a proper opportunity of dealing with this new situation.  As a result, he was denied a fair hearing on the issue as to whether there should be a retrial.  It follows that the answer to the first certified question is “yes”.

9.  In these circumstances, it was agreed that the appeal to this Court would have to be allowed and the question of whether or not there should be a retrial reconsidered.  It would have been open to this Court to remit to the Court of Appeal this issue as to a retrial.  However, we decided, in agreement with counsel for the appellant and the respondent, that the more appropriate course was for this Court to deal with the issue.  An advantage of our doing this is that it enables this Court to express its views on the issues of principle that arise as well as on the merits of there being a retrial.

The relevant legislation

10.  The terms of s.19(1) of the Theft Ordinance, Cap. 210 (“the Ordinance”) which the appellant is alleged to have contravened provide:

“(1)   Where a person dishonestly, with a view to gain for himself or another or with intent to cause loss to another- 

(a)  destroys, defaces, conceals or falsifies any account or any record or document made or required for any accounting purpose; or

(b)  in furnishing information for any purpose produces or makes use of any account, or any such record or document as aforesaid, which to his knowledge is or may be misleading, false or deceptive in a material particular,

he shall be guilty of an offence and shall be liable on conviction upon indictment to imprisonment for 10 years.”

11.  The language of s.19(1) makes it clear that it is to be given a broad and generous application.  This is confirmed by the definitions in ss 5 and 8 of the Ordinance.  “Gain” and “loss” are defined in s.8 of the Ordinance:

“(2)  For the purposes of this Ordinance –

‘gain’ and ‘loss’ are, except in section 16A, to be construed as extending only to gain or loss in money or other property, but as extending to any such gain or loss whether temporary or permanent; and-

(a) ‘gain’ includes a gain by keeping what one has, as well as a gain by getting what one has not; and

(b) ‘loss’ includes a loss by not getting what one might get, as well as a loss by parting with what one has; ‘goods’ except in so far as the context otherwise requires, includes money and every other description of property except land, and includes things severed from the land by stealing.”

12.  As to the meaning of “property”, it is necessary to refer to the definition of property contained in s.5(1):

“(1) ‘Property’ includes money and all other property, real and personal, including things in action and other intangible property.” 

13.   The power of the Court of Appeal to order a retrial is contained in s.83E of the Criminal Procedure Ordinance, Cap. 221.  That section provides as follows:

“(1) Where the Court of Appeal allows an appeal against conviction and it appears to the Court of Appeal that the interests of justice so require, it may order the appellant to be retried.

(2) A person shall not under this section be ordered to be retried for any offence other than -

(a)  the offence of which he was convicted at the original trial and in respect of which his appeal is allowed as mentioned in subsection (1);

(b)  an offence of which he could have been convicted at the original trial on an indictment for the first-mentioned offence; or

(c)   an offence charged in an alternative count of the indictment in respect of which the jury were discharged from giving a verdict in consequence of convicting him of the first-mentioned offence.”

14.   The effect of s.17(2) of the Court of Final Appeal Ordinance, Cap. 484, is that when this Court decides to deal with the question of a retrial, it has the same powers as the Court of Appeal.

15.   I draw attention to the following points as to s.83E:

(1) Section 83E expressly provides that it is the appellate court, whether this Court or the Court of Appeal, to whom it must appear to be in the interests of justice that the appellant should be retried.

(2) Unless the requirements of s.83E(2) are complied with, a retrial cannot be ordered by the appellate court.

(3) If there is compliance with s.83E(2), then a retrial can be ordered as long as it appears to the Court of Appeal that this is what the interests of justice require.

The nature of the prosecution’s case

16.   The two counts of false accounting, of which the appellant was found guilty, were the only offences with which he was charged.  They were in the conventional form.  The particulars of the offences, which were set out in the indictment, were in the following terms: 

“(1) TING James Henry, on or about the 26^th day of June 1999, in Hong Kong, dishonestly with a view to gain for himself or another or with intent to cause loss to another, falsified a document made or required for an accounting purpose, namely the audited accounts for Semi-Tech (Global) Company Limited for the year ending the 31^st day of January 1999, by making or concurring in the making of an entry therein which was or may have been misleading, false or deceptive in a material particular in that it purported to show that Semi-Tech (Global) Company Limited had an interest in an associated company namely 50% shareholding in MicroMain Systems Ltd.

(2) TING James Henry, on or about the 26^th day of June 1999, in Hong Kong, dishonestly with a view to gain for himself or another or with intent to cause loss to another, falsified a document made or required for an accounting purpose, namely a letter of the Semi-Tech (Global) Company Limited dated the 26^th day of June 1999 addressed to Ernst and Young, by making or concurring in the making of an entry therein which was or may have been misleading, false or deceptive in a material particular in that it purported to represent that the group had purchased certain shares held by Winsoft in MicroMain Systems Limited (MicroMain) at a consideration of $38.46 million United States currency (i.e. HK$300 million).”

These particulars were in general terms.  Not surprisingly in these circumstances, those representing the appellant attached importance to his being informed as to precisely how the prosecution would present their case.  However, committing themselves as to how they would run their case caused the prosecution considerable difficulty.  In his Supplemental Case, Mr Alun Jones QC lists the repeated changes that have taken place in the prosecution’s approach to what constitutes “gain” and “loss” in the two counts of the indictment.  These changes occurred between the time when trial started in May 2005 and prosecution presenting their case at the hearing before this Court.   Mr Alun Jones QC relies heavily on the changes both to show that the prosecution did not even have a prima facie case and, if they did, that they should not be allowed to have a retrial to make up for the shortcoming of their case as presented at the trial.  To assess these submissions, it is necessary to consider the facts on which the prosecution relied.  In keeping the position as simple as possible, I rely on the helpful summary of Tang JA in his judgment in the Court of Appeal.

17.  The appellant was the group chairman and chief executive officer of Semi-Tech Global Company Limited (“STG”).  He had, with the assistance of his partner, Mr Holmes, been the architect responsible for the creation of STG.  40.3% of the issued share capital of STG was owned by Semi-Tech Corporation (“STC”), a Canadian company of which the appellant was also chairman and chief executive.  At their peak, the group of companies, of which STG and STC were part, employed over 100,000 staff, operated in over 100 countries, and had an annual turnover of HK$40 billion.  Both STG and STC are now in liquidation.

18.  The first count in the indictment refers to the annual report of STG for the year ending 31 January 1999 which was published on 26 June 1999.  It was signed by the appellant and contained a statement that STG had “an interest in an associated company consisting of a 50% shareholding in MicroMain Systems Limited (“MM”)”.  The second count related to a letter written on behalf of STG dated 26 June 1999 which was signed by the appellant and addressed to Ernst and Young, the auditors of STG.  The letter stated that STG had purchased from, an independent 3^rd party, Winsoft Limited (“Winsoft”), shares held by Winsoft in MM at a cost of US$38.46 million (HK$300 million).  At the core of the prosecution’s case, was an allegation that no shares in MM had been acquired by STG, directly or indirectly, for HK$300 million or at all.

19.  The principal prosecution witness was Charles Sun (“Sun”) who with his wife owned and controlled MM.  According to Sun, he had made an agreement with the appellant to sell 50% of MM to the appellant for the substantially lower figure of US$5.5 million.  It was pursuant to this agreement that the shares had been transferred but subject to a condition that Sun was paid the purchase price by instalments.  Full payment had not been made. 

20.  According to the accounting record and information supplied to the auditors, 50% of the shareholding of MM was supposedly acquired as a result of a Share Purchase and Sale agreement of the 18 November 1998 between Winsoft and Fortune 2000 Limited (“Fortune”), both BVI Companies.  STG owned Fortune and the Share Purchase and Sale agreement purported to be signed by the appellant on behalf of Fortune.  The agreement also purported to be signed by Mr Sun’s sister, Betty Cheng.  Betty Cheng denied this signature was hers and her evidence was supported by that of an expert in handwriting. 

21.  In his evidence at the trial, the appellant suggested that there was an agreement by STG to acquire the MM shares for HK$300 million, 10% of which would be paid for in cash, the remaining being paid for by debentures to be issued by the Singer Group.  That group was controlled by STG and according to the appellant, the Singer Group owed STG US$38.8 million.  Sun denied that there was ever such an agreement.  The appellant also claimed to have signed the letter without noticing its contents and also denied responsibility for the Share Purchase and Sale agreement.  However, as is confirmed by the appellant’s conviction by the jury, the prosecution’s case of dishonesty on the part of the appellant, was extremely strong. 

22.  At the trial, the judge handed to the members of the jury a document which correctly summarized the four elements of the offence.  The document is in these terms:

“(1)  The accused made or concurred in making an entry in a document required for an accounting purpose.

(2)  The entry is false in a material particular, that is to say an important aspect, a thing which mattered and it is known to the accused to be a false entry.

(3) The accused did so, or concurred in doing so, DISHONESTLY and with a view to gain for himself or another.

(4) Or with intent to cause loss to another.” 

23.  From what I have said already, it is clear from their verdict that the jury were satisfied as to elements 1 and 2.  As to 3 and 4, it is also clear that they were satisfied as to “DISHONESTLY”.  Any doubt which the jury might have had, would have been removed by the fact that, in addition to the evidence to which I already referred, certain entries in STG’s record were also agreed in evidence which dealt with payments of HK$300 million in total by and to STG in tranches of HK$100 million, the initial payment being made by STG followed by a subsequent payment back to STG by cheques dated between 11 December 1998 and 18 December 1998.  It was the prosecution’s case that these cheques evidenced that STG, which had available HK$100 million, used that HK$100 million so as to indicate that there had been a payment by STG of HK$300 million to purchase the shares in MM.  However, when a tranch of HK$100 million was returned to STG, it was entered into “the BT-Deposit account”, but not only was there no examination on behalf of the prosecution of that account, the expert accountant upon whom the prosecution relied, Mr Lees was not instructed to investigate the account. 

24.  Further, the accountants who gave evidence at the trial were agreed that, from an accounting point of view, even a sum as large as HK$300 million would not materially affect the financial position of STG. 

25.  Despite this, it is understandable that Tang JA, in his judgment in the Court of Appeal (para.31), stated “on these facts, one would have thought that the prosecution had a straightforward case, so far as gain and loss were concerned”.  The “gain” would be made by the three companies to whom the tranches of HK$100 million was paid in turn by STG.  It did not matter that the money was “cycled” back to STG.  It did not matter the gain was temporary because of the definition of gain in s.8(2).  In the absence of evidence to the contrary, Tang JA considered the only possible conclusion was that the payments made by the companies to STG were “for the purpose and/or for the benefit of each of three companies, or the persons behind them.  The loss to STG was also clear.  STG was caused to pay $300 million in return for a fictitious asset”. 

26.   But this was not the way the prosecution presented its case before us or the lower courts.  The prosecution in its opening suggested that the purpose of the false investment was to overstate the assets of STG with a view to gain because STG had got “what it has not paid for”.  “Alternatively, the appellant had intended to trick the creditors into refraining from taking recovery action of the money lent.”  Tang JA considered that this approach turned “the matter on its head.  The victim STG had become beneficiary of the false accounting!”

27.  Tang JA did, however, suggest the different approach to “gain” and “loss” referred to above was possible even though all the accounting experts seemed to have agreed, that the “overstatement of assets” by $300 million was immaterial in the accounting sense.  

28.  Subsequently, having considered the case of R v. Golechha and Choraria (1990) 90 Cr App R 241, on s.17 of the Theft Act 1968 which is identical to s.19 of the Theft Ordinance, which was distinguished in R v. Siu Yin King [1993] 2 HKC 254, a decision of the Hong Kong Court of Appeal, Tang JA came to the conclusion that in the absence of evidence of materiality in an accounting sense as to what had occurred and the lack of a direction by the judge that materiality was relevant, the verdicts could not be maintained.  He was also doubtful about the propriety of allowing the prosecution at a late stage of the trial to rely on a different way of advancing the case, namely that the disposal of shares in STG by STC should be adduced to prove “gain”.  This did not, however, matter because he also took the view that, as there was no evidence as to what influence the publication of the annual report had or might have had on the share price, a conviction on this basis could not be maintained.

29.  Woo VP, was also of the opinion that the convictions were unsafe and unsatisfactory.  He relied primarily on what he considered to be a misdirection, namely the direction to the jury to ignore the immateriality of the amount involved in the falsehood.  In particular, he disagreed with the judge that it was appropriate to direct the jury:

“So what is important in relation to the bankers is that, to them, it is not a question of the size of the investment, or whether it is overstated.  The question is the accuracy of the accounts.”

The third member of the court, Lunn J, took a similar view on this point.

30.  I have reservations as to whether the criticisms of the trial judge by the Court of Appeal were justified.  In particular she, in my view, was right to focus on the effect of dishonesty on the bankers in relation to the loans that were outstanding which did not depend on the materiality in accounting terms of the dishonest transaction but this is not a matter on which we have or need to adjudicate upon for our consideration of the question of whether there should be a retrial.

31.  The Court of Appeal having decided to allow the appeal for the reasons already given it was not necessary for it to deal with an allegation of alleged apparent (not actual) bias on the part of the judge which she had rejected.  It is the same position before this Court.  However, in justice to the trial judge, I should make it clear that if it had been necessary to deal with the issue I would have needed a considerable persuasion that it was of any substance. 

32.  Before this Court, the prosecution did not take advantage of the suggestion of Tang JA that “… a straightforward case, so far as gain and loss were concerned” could be based upon the receipt by the three companies of HK$100 million, while STG had made a loss, having paid HK$300 million in return for a fictitious asset.  Instead, in the Case for the Respondent, the prosecution stated that the way they would present “gain” and “loss” had been reconsidered and the final position was as follows:

“… The Respondent argues that the evidence shows that as at June 1999 STG was in a financially precarious position and was vulnerable to this being exposed by the auditors investigation of the MicroMain transaction.  By successfully deceiving the auditors the Appellant acted:

(i)  with a view to gain to STG in keeping its credit facilities with its bankers and with an intent to cause loss to those bankers by deceiving them into not cancelling those facilities and seeking repayment of their loans; and

(ii)  with a view to gain to the Appellant, in the form of his remuneration as Chairman of STG and in the form of preserving the value of his substantial shareholding.”

33.   That this was the final position of Mr McWalters SC did not prove to be the case before us.  He confined the prosecution’s case to the view of gain and loss as set out in (i) and abandoned the formulation in (ii).  Despite this, Mr McWalters SC continued to rely on a subsequent passage of his Case where it is stated:

“The motivation for the false accounting offences was concealment and perpetuation of this original fraud.  Having once created the false asset (for whatever reason) the Appellant had embarked on a course of action from which there was no turning back.  Because of this, he could not allow his conduct to be discovered.  Hence the concerted effort … to deceive the auditors.  Materiality, in the accounting sense, is irrelevant to this motivation.  It would not matter whether the fraud was HK$2 mil or $200 mil precisely because it was management perpetrated fraud.  Fraud immediately raises the spectre of dishonest management and unreliability of accounting records and would have prompted the response from the bankers as described by them in their testimony.  Once fraud has taken place, materiality in the accounting sense ceases to be an issue.” 

Having drawn attention to some of the issues before the Court of Appeal, I can now turn my attention to the issues before this Court.

Has this Court jurisdiction to order a new trial

34.   Mr Alun Jones QC challenges the jurisdiction to order a new trial in this case.  He does not do so on the basis of any general lack of jurisdiction.  He does so because he submits on a proper interpretation of s.83E, the offence in respect of which the prosecution are now seeking an order for a retrial is not the offence of which the appellant was convicted at the original trial and as the alternative requirements of subsection (2) are not applicable, no retrial can be ordered.  Mr Alun Jones QC submits when subsection (2) is properly construed, in order to ascertain whether it is the same offence on which the appellant was tried, which it is proposed he should be retried, it is not sufficient to consider the indictment.  It is necessary, in a case such as this, to identify the manner in which the prosecution had developed its case at the trial and consider whether this accords with the manner in which it is proposing to develop its case if there is to be a retrial.  He refers specifically to the difference between the way in which the intent in relation to “gain” and “loss” was advanced by the prosecution at first instance and the way this is now being approached.

35.   Whether Mr Alun Jones QC is correct in his submission is by no means an easy question to resolve.  It turns on the use of the word “offence” in s.83E.  It is an issue on which, apparently, there is no helpful authority.  The explanation for this is probably because usually there is no issue raised as to jurisdiction of the appellate court to order a retrial.  Instead, the court deals with any possible difference in the case put forward by the prosecution at the trial and on appeal as an important factor in determining whether there should be a retrial when considering whether it is in the interests of justice that there should be a retrial.

36.   The reason that in s.83E(2) a distinction is drawn between the original offences and the proposed offences and this is made a limitation on the power of the court to order a new trial, could be the fact that if there is a difference which is one of substance, there can be a new trial so there is no need for a retrial.  This is because the defendant will not be able to rely on the previous proceedings as a bar on a further prosecution.  It is only possible to plead autrefrois acquit or convict if: (i) the offences at the first and second trial are the same; or (ii) the offence is one which could have been the subject of a conviction at the first trial on an indictment for the first-mentioned offence and; (iii) any alternative count in the indictment is not one which the jury was discharged from giving a verdict in consequence of the conviction of the first-mentioned offence.  This is made perfectly clear by s.83E(2)(b) and (c), both of which it is to be noted refer to an “indictment” though (2)(a) refers to the offence of which he was convicted at the original trial. 

37.   Having referred to the references to “indictment” in s.83E, it is appropriate to refer to the Indictment Rules of 9 July 1976.  The heading to r.2 is “Basic form of indictment”.  This requires an indictment to be in the form set out in the schedule or a form substantially to the like effect. 

38.   Rule 3 of the rules deal with the “Statement of offence in indictment”.  Rule 3(1) requires every indictment subject to r.4 (which is not relevant for present purposes) to contain and to be sufficient if it contains “a statement” of the specific offence with which the accused is charged describing the offence shortly, together with such particulars as may be necessary for giving reasonable information as to the nature of the charge.

39.   Rule 3(3) of the rules gives the judge power to order further particulars to be delivered “in any case in which he deems it expedient to do so”.

40.  Rule 4(c) is also of relevance since it provides (among other things) that:

“it shall not be necessary to specify or negative an exception, exemption, proviso, excuse or qualification.”

41.  These provisions of the Indictment Rules confirm my initial view that “offence” in s.83E is a reference to an offence that appears in an indictment, the parameters of which are set by the statement of offence and the particulars of the offence set out in the indictment.  This appears to be the interpretation most in accord with the language of s.83E(2).  It provides a test which will enable what is the “offence” to be readily determined.  A result which is highly desirable not only in the case of a retrial, but in the case of the other references to “offence” in other parts of the Criminal Procedure Ordinance.  In particular, it is important for the purposes of determining whether a plea of autrefois convict or autrefois acquit should be upheld under s.31 of the Criminal Procedure Ordinance.  Here the reference is to the “offence charged”.  The alternative position for which Mr Alun Jones QC contends, would by contrast be difficult to apply in some situations.  For example, there could be a dispute as to what constituted particulars on which the prosecution relied even though the proceedings were recorded.

42.   Two situations relied on by Mr Alun Jones QC have, however, caused me some concern.  The first is where the judge orders additional particulars to be given under r.3(3).  The terms of r.3(3) are very wide and it does not seem to me that it would be right to cater for particulars ordered by a judge which do not fall within the requirements of r.3(1).  That is because they are not such particulars “as may be necessary for giving reasonable information as to the nature of the charge”.  If the particulars are necessary to fulfil that requirement then, in my view, this would be a situation where the particulars should be taken into account in determining what is the offence for s.83E.  The other situation relied on by Mr Alun Jones QC is illustrated by an offence such as manslaughter which can take more than one form.  In such a situation, it seems to me if the count in the indictment does not make this clear, it is necessary to take into account the type of offence falling under the head of manslaughter which was left to the jury by the judge in the summing-up since that would be the offence of which, in the words of s.83E(2)(a), the defendant was convicted.  However, these exceptional situations apart, the simple rule I have identified is the rule that should be applied in determining what is the offence.

43.  Applying this interpretation of the word “offence” to the present case, there can be no question that the retrial if ordered, would relate to the same offence.  Under s.83F(1), the judge having ordered a retrial, the appellant would have to be retried on a fresh indictment preferred by the direction of the appellate court.  Although the manner in which the prosecution has advanced its case has frequently changed, the form of the indictment has not changed and the counts would follow the counts in the original indictment.

The issue of “gain” and “loss”

44.  An explanation for part of the prosecution’s difficulties in identifying the “gain” and “loss” is the English decision in R v. Golechha and Choraria (1990) 90 Cr App R 241.  Prior to the decision in that case, the view generally had been that postponing the evil day of having to pay a debt can be a sufficient gain for the purposes of a conviction under s.17 of the Theft Act which is equivalent of s.19 of the Hong Kong Legislation.  However, in Golechha it was held that a debtor who dishonestly persuades the creditor to forbear from suing for his debt does not have a “gain” within the meaning of the section.  But why not?  As the late Sir John Smith stated in the Law of Theft, 8^th Edition (Butterworths 1997) 6-08 p.152 why does not the debtor have a view to gain by keeping what he has?  A deed of postponement of a prior charge in favour of another obligation does “cause loss” (see also his note to the case in [1990] Crim.L.R. 865).  “Gain” need not be the debtor’s sole object (Arlidge and Parry on Fraud, 3^rd Edition with regard to the decision in Golechha).  Professor Edward Griew in “the Theft Acts” is also critical (see para.12/05 to 12/08).  Although in subsequent cases before the English Courts, Golechha has not been endorsed, it has not been overruled.  However, in Hong Kong, in R v. Siu Yin King, [1993] 2 HKC 254, it was restricted in its operation.  In my view the reservations as to the decision in Golechha are justified.  So far as the law of Hong Kong is concerned, the decision in Golechha should not be regarded as an authority supporting the proposition that because a defendant seeks to avoid being sued, he is not also acting with a view to gain or with the intention to cause loss for the purposes of s.19 of the Ordinance.  If a creditor is dishonestly persuaded not to seek to recover his debt, there will be a beneficiary and if a defendant’s object is that at least temporarily to retain the money which his creditor forbears from recovering he will receive a benefit in being able to retain the money.  Likewise the creditor can be, at least temporarily, deprived of money which he would otherwise have recovered and accordingly can temporarily suffer loss.  When s.19(1) is read with s.8(2) and s.5 of the Ordinance, dishonest conduct intended to have these consequences can constitute offences of false accounting.  A defendant can be taken to intend what will be the inevitable consequences of his intentional conduct.

45.   Before leaving the question of intent in s.19(1), I should refer to Longmore LJ’s comment in giving judgment in R v. Zaman [2003] FSR 13 on which Mr Alun Jones QC also relied.  The decision was in respect of the identical language to that which appears in s.19 as to intent in s.92 of the Trade Marks Act 1994.  Longmore LJ approved the direction of a trial judge in relation to s.92 of that Act that:

“the phrase ‘with a view to’ meant simply that the defendant had something in his contemplation, not necessarily something that he wanted or intended to happen but something which might realistically occur.”

46.  In respect of this direction, Longmore LJ acknowledged that in the case of certain sections of the Theft Act, including s.17 it is not usually material to differentiate between “with a view to” and “intent to cause” since the mens rea of the offences set out in those sections of the Theft Act is, in any event, one of dishonesty.  Where, however, “dishonestly” did not appear in the offence under the Act of 1994, Longmore LJ considered the approach of the trial judge was correct.  While I do not doubt Longmore LJ’s approach to the Trade Marks Act 1994, I do not accept, as Mr McWalters SC contended, that it should be applied to the offence which we are considering under s.19.  “With a view to gain” means with the intention of gaining, the other side of the coin to an intent to cause loss.

47.  This does not detract from the way the prosecution now intends to advance its case if a retrial is ordered.  If the prosecution were at the retrial able to establish, that the reason for the defendant’s dishonesty was to conceal the earlier deception as to the acquisition of shares in MM to avoid STG’s bankers recalling their loans, this would be with a view to gain by STG in keeping its assets that otherwise might have to be used to repay its bankers.  This would be, in the language of s.19(1) of the Ordinance, with “a view to gain for another”.  Further, it would involve a gain which falls within the definition in s.8 because it would be a gain in money, by keeping what STG had, namely the money which it otherwise would have to use to repay the loans.  This would not involve a departure from the way in which the case had been advanced at the trial.  At the trial, witnesses from five different banks had been called to give evidence and they confirmed that STG had been heavily indebted to them.  In his evidence, the appellant did not dispute the borrowings.  The bankers also gave evidence of what must have been obvious to the appellant that if they had been aware of his fraud, this would have caused them to seek repayment of the loans.  As Mr McWalters SC submits, this is an issue quite separate from whether the sum involved in the dishonesty was material in relation to the finances of a group of the scale of STG.  It is obvious that any banker will be unwilling to continue to advance credit to a company if there has been serious dishonesty on the part of its most senior executive.

48.   The fact the prosecution has now limited the way which it is advancing its case would make it much simpler for a jury to understand.  However, although it might be thought that it should also reduce the evidence which is needed, I am satisfied that Mr Alun Jones QC is correct when he says this would not, in fact, prove to be the case.  While I would hope that both the prosecution and the defence would seek in the interests of justice to restrict the case as far as was possible, Mr Alun Jones QC is right that the financial health of STG would be very relevant to the issue of the appellant’s guilt.  As the Respondent’s Case makes clear, the prosecution would seek to show that STG at the time of the offences in June 1999, was “in a financially precarious position”.  Some evidence as to the position of STG in 1999 was adduced at the trial, but this would assume a much more prominent role at any retrial since if this was the situation, it would make it much more likely that the appellant’s dishonesty was intended to avoid the loans to STG having to be repaid.  It would therefore be a matter that the appellant would wish to contest.

Should this court exercise its discretion to order a retrial

49.  The critical question when considering a retrial is, in the language of s.83E of the Criminal Procedure Ordinance, what justice requires.  The general approach was set out by Lord Diplock in 1978 in a case when the Court of Appeal of Hong Kong’s exercise of its discretion was being reviewed by the Privy Council.  In this case, the situation is different, it is this Court, which has to exercise its discretion. The task is not one of review.  However, Lord Diplock’s words are still worth repeating.  In Au Pui-kuen v. Attorney General [1979] HKLR 16 at p.19, Lord Diplock said:

“  The discretion whether or not to exercise the power to order a new trial in any particular case is confided to the Court of Appeal of Hong Kong and not to their Lordships’ Board.  To exercise it judicially may involve the court in considering and balancing a number of factors some of which may weigh in favour of a new trial and some may weigh against it.  The interests of justice are not confined to the interests of the prosecutor and the accused in the particular case.  They include the interests of the public in Hong Kong that those persons who are guilty of serious crimes should be brought to justice and should not escape it merely because of a technical blunder by the judge in the conduct of the trial or his summing-up to the jury.

It would not, in their Lordships’ view, be helpful to attempt a catalogue of the various factors which the Court of Appeal should take into consideration in determining how to exercise their discretion, still less to make any suggestion as to the relative weight to be given to them.  The factors that are relevant and their relative importance may vary greatly as between one case and another.  These are matters which call for the exercise of the collective sense of justice and common sense of the members of the Court of Appeal of Hong Kong …”

50.  Mr McWalters SC accepts that the issue is ultimately one for this Court but he contends that the principles of separation of powers require this Court to attach the greatest importance to the views of the prosecution as part of the executive.  He contends there is a close analogy between considerations that arise on an application for a retrial and the considerations that arise on an application for a stay.  I do not accept this approach.  It is true that it has limited support from statements of high authority made in judgments in the High Court of Australia.  However, those remarks were not made in the context of the language of s.83E.  In addition, the considerations that arise on an application for a stay by a defendant and an application for a retrial by the prosecution are different because in the former case there has not yet been the completion of a trial and therefore no question of double jeopardy.  A factor that has to be given the greatest weight in determining any application for a retrial is the fact that the defendant has already undergone one trial.  This is of particular significance where the trial was long and complex as in this case.

51.  What I just said does not mean that this Court does not have regard to the views of the prosecution.  The prosecution is entitled to have weight attached to its views because not only is it the prosecuting authority, but also in adversarial proceedings, it is best qualified to present the views of the public to which importance has to be attached when determining what justice requires.  It can be contrary to the interests of justice if the public feel enraged or even disquieted at the fact that a defendant, who may have committed a serious offence, apparently escapes the normal consequences of his crime because a failure in the trial process has resulted in his conviction being set aside.  This could certainly be said to be the position in the present appeal.  If the prosecution had advanced the case at the trial in the limited manner in which it is now proposed, the problems that have occurred may well have been avoided. 

52.   It would, however, be wrong to attach excessive significance to this aspect on this application for a retrial.  It is important to bear in mind that the appellant who was of previous good character has, in my view, properly been found by a jury to have acted with dishonesty notwithstanding that his convictions had to be set aside.  However, the dishonesty that was established at this trial fell short of establishing that the appellant’s dishonesty was responsible for the collapse of the group.  In addition, the appellant will not go unscathed if there is not a retrial.  In the court below, he was sentenced to six years’ imprisonment.  In the circumstances of this case, it is likely this is the maximum sentence that would be imposed after a retrial at which he was found guilty.  Credit to which he is entitled for the period which he has served would, in any event, mean according to the normal principles which have to be applied to a sentence of this nature, that the difference between the period already served and the period that might have to be served after a retrial would not be great.  In addition, it must be a blow to him that the group that he was substantially responsible for creating has collapsed.

53.  If there were to be a “retrial”, as already indicated, it would last a considerable time in respect of an offence committed in 1999.  It would also give rise to considerable expense.  However, what is perhaps more important, is that having regard to the time that has elapsed since the alleged offence, it would not be easy in a criminal trial for both the prosecution and the defence to investigate the issue of the financial state of STG in 1999.  The prejudice this could cause to the defendant I regard as being a matter of significance. 

54.  Mr McWalters, SC in his supplementary case, identifies 17 potentially relevant considerations that can be taken into consideration in deciding whether there should be a retrial.  I do not propose to lengthen what is already a long judgment by referring to those considerations.  I do, however, make it clear that I have taken them into account.  I have also taken into account the very valuable guidance which is given in the judgments both of the majority and the minority in R v. Taufahema (2007) 234 ALR 1.  What I have attempted to do is, after a consideration of the advantages and disadvantages that could accrue to the public, the prosecution and the defence, to come to a conclusion as to whether a retrial would best serve the interests of justice.  Having done so, my decision, taking account of the arguments advanced by Mr McWalters SC and Mr Alun Jones QC, is that in this case, the disadvantages of a further trial outweigh the advantages.  It would not be in accord with the interests of justice to order a retrial.  Accordingly, I do not do so.

55.   There are two lessons that could usefully be learned from what has happened in the course of these proceedings.  The first is the importance of the prosecution at the outset of the proceedings identifying the best way in which to present its case and carefully considering what counts to include in the indictment.  Here, the prosecution’s task was made more difficult because of the impediment created by the decision of Golechha.  Nonetheless, as the decision of the Court of Appeal makes clear, insufficient consideration was given to the formulation of the prosecution’s case.  A considerable amount of expense and confusion could and should have been avoided.  The trial judges’ task was made unnecessarily difficult by the failure of the prosecution. 

56.    In addition, the argument in this case over the issue of retrial makes clear that in a complex case in which the question of a possible retrial is debateable, the court may need to have the benefit of further argument.  For this purpose, it may well be desirable to have a separate hearing on the question of retrial after the outcome of the appeal is known.

57.   Finally, I would like to acknowledge the assistance which we have received from both those who represent the prosecution and the appellant on the hearing before us.  It enabled us to deal with this appeal more expeditiously than would otherwise be the case.

58.   In answer to the certified questions I refer to my judgment.

59.   I would allow the appellant’s appeal but do not order a retrial.

60.   As to costs, the appellant should be awarded the costs of this appeal, the costs of the application to the Appeal Committee for leave to appeal and the costs of the application to the Court of Appeal for certification.  The Court of Appeal had refused to award costs of the trial in the appellant’s favour.  The parties should submit written submissions within 28 days on the question of costs of the trial.

Chief Justice Li :

61.   The Court unanimously allows the appellant’s appeal but does not order a retrial.  The Court makes the costs orders set out in the final paragraph of the judgment of Lord Woolf NPJ.  The parties are directed to lodge written submissions within 28 days on the question of costs of the trial.